What area is your expertise?
What trends do you see presently in retail development in your area?
We are seeing an increase in vacancy rates in both anchor spaces and in-line shops, as some existing tenants are vacating.
What type of retail product is doing well in your area?
As in most areas, Costco, Sam’s, Wal-Marts, and Dollar Stores are seeing increased sales. Sales have shifted to retailers with perceived value. Subway’s has also reported increased sales with their $5 sub sandwich promotion.
What retailers are new to your area?
Dillard’s, Cabella’s, Scheel’s and RC Willey.
Who are the active retail developers in your area?
Lewis Operating, Red Development and Bayer Properties.
Please name one or two significant retail developments in your area. What impact will these projects have on the market?
Damonte Ranch Town Center developed by Lewis Operating. The center is anchored by The Home Depot, Office Depot and RC Willey. The center has additional anchor space available. It is located in south Reno east of U.S. 395 at Steamboat and Damonte Ranch Parkway. This center is located in the middle of a master-planned community that will have over 15,000 homes in the immediate area when completely built-out. It will be the main commercial development supplying the needs of this master planned community.
Legends at the Sparks Marina developed by Red Development. The center will be anchored by a Scheel’s Sporting Goods, Target, Best Buy as well as other potential big-box tenants, lifestyle tenants, restaurants and a resort hotel casino. The project is located at the Sparks Boulevard exit on the north side of U.S. 395.
Where is the majority of development taking place? Why is this area doing well?
Developments are occurring in south Reno, Spanish Springs and east Sparks along Interstate 80. The first two locations have significant residential development occurring and planned for the future. The later site is the home to the Legends at the Sparks Marina, which is a freeway/tourist-oriented development.
What area do you expect to be the next big retail development market? Why?
In addition to South Reno, the north valley along U.S. 395 north will see retail development as the residential market recovers. This area will see more affordable housing developments, which should be the first segment of the housing market to begin construction in the recovery. Retailers will flock to this market once it reaches critical mass and the first couple of big box tenants prove the viability of this sub-market.
Please describe the retail leasing activity in your area.
With the new housing developments slowing down in our area, the retail developments in the outlying areas have slowed down. We are seeing a select set of retailers looking to take advantage of the availability of good sites as some of the current anchors have been swept up in the house cleaning, national bankruptcies and local relocations going on with retailers.
What major leases have been closed recently?
Target with 127,000 square feet and Scheel’s Sporting Goods with 245,000 square feet in the Legends at Sparks Marina. Whole Foods with 62,000 square feet in the Del Monte Plaza.
Please give a measure of retail vacancy rates and a measure of available sublease space.
Vacancy Rate of 9.82 percent, anchor vacancy rate of 7.01 percent, In-Line vacancy rate of 13.69 percent. These apply to the Reno/Sparks metropolitan area.
What types of retailers should look into your market in the coming year? What type of retail is needed?
Discount Apparel, more variety of national coffee stores such as Peete’s Coffee, Seattle’s Best, and restaurant and entertainment uses for downtown Reno in conjunction with the new AAA baseball stadium.
Would you like to make any additional observations about the retail market in your area?
Reno continues to be an in-bound market with population and job growth. Once the residential market in California improves to where those residents can sell their houses, there will be an increase in residential growth in Reno as our homes have gained in the affordability spread as compared with home values in California.
Submitted by Kelly Bland, senior vice president with the Reno office of NAI Alliance.